Playbook 03 · Slide 06 of 10 · Context · Price vs VWAP · Volume-Weighted Direction

VWAP Context

VWAP (Volume Weighted Average Price) is the institutional fair value line. Where price sits relative to VWAP tells you who's in control — buyers or sellers.

Above VWAP

Bullish

Buyers in control

Below VWAP

Bearish

Sellers in control

Crossing VWAP

Contested

Wait for confirmation

Bouncing Off

Dynamic S/R

High-prob entry

VWAP + School Run

Above VWAP + breakout: Strong trend long. Price is above fair value and breaking structure. Buy pullbacks to VWAP.

Below VWAP + breakdown: Strong trend short. Price is below fair value and breaking structure. Sell rallies to VWAP.

Chopping through VWAP: Range day confirmed. VWAP acts as a magnet. Fade moves away from VWAP.

Price reclaims VWAP: Shift in control. If it holds above VWAP for >15 min, bias flips bullish.

VWAP + Fishing Technique

Fishing buy near VWAP: High probability. The stop-run dips below a swing low, then snaps back above VWAP. This is the ideal setup.

Fishing sell near VWAP: High probability. Price spikes above a swing high, then rejects back below VWAP.

Fishing against VWAP: Lower probability. Don't fish long when price is 20+ points below VWAP. The pullback may not hold.

VWAP as target: In range days, VWAP is often the best partial exit target. Take profit at VWAP, trail the rest.

⚠ VWAP Rule: In trend days, VWAP is a pullback entry zone — not a fade zone. In range days, VWAP is a mean reversion target. Mixing these up is the second most common School Run mistake.

The Three Tools Together

EMA (9/20): Sets the directional bias. Which direction to favor.

School Run Bracket: Classifies the day. Trend or range.

VWAP: Provides context. Where is fair value? Who's in control?

Fishing Technique: Triggers entries. Catches the reversal.

All four must align for the highest-probability trades.